SA women suffering a financial meltdown
South African women are passionate about plastic – the sleek, rectangle-shaped kind that is shoved into the pockets of their purses.
According to Robyn Farrell, executive head of 1st for Women Insurance, many women are finding themselves in financial trouble because of their love of plastic.
“Statistics from the Credit Bureau show that 48.4 per cent of South Africa’s credit-active women have negative information, such as defaults, on their records.
“A default means you have failed to make payments as per your agreement. A default is held on the system at the Credit Bureau for two years and can jeopardise your chances of accessing credit elsewhere, such as when you want to get finance for a house or a car,” she says.
Farrell adds that ideally, you don’t want to land up in this position or worse still, with a judgement against you.
“It’s time for the ladies to shape-up and get their ‘houses’ in order,” says Farrell.
Farrell stresses that women need to think with their heads and not their hearts when they are shopping.
Using and abusing credit is a vicious circle for many South Africans. The quarterly Synoptic Report by Compuscan highlights the increase in credit utilisation and shows an increase in the number of revolving credit facilities in the higher balance categories.
The number of revolving loans with a value of R100 000 and over increased by 50 per cent in the fourth quarter of 2012.
“Take charge now. You must keep an honest account of what you spend, and be realistic about what you can afford to pay back if you dip into your credit,” she says.
She offers the following advice:
* Reduce the number of credit cards you carry around to one. If you can, pay extra into one card until the debt is paid off, then start paying that extra amount into another card until it is also paid off.
* Don’t use your credit card unless you are able to pay the minimum amount due each month.
* Always pay the minimum amount due on your credit cards each month.
* Choose to pay with your debit card or cash rather than using a credit card.
* If you are offered a higher credit limit on your credit card by your bank, do not accept it.
*Set a monthly budget and do not spend more than that. Your expenses should never be more than your income.
* Keep track of purchases by retaining invoice slips and tallying up your expenditure.
* Never buy food or other necessities on credit.
* Do not open retail store cards or accounts.
